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Sunday, June 30, 2013

The ALN-TTR02 phase II results have finally been announced. The results are consistent with the view that
ALN-TTR02 is a strong candidate for becoming RNAi’s first marketed drug. Having said that, the knockdown efficacy
results came short of what one could have expected based on the phase I and
non-human primate results and explain why the company has amended the protocol
to test increased dosing frequencies.

Non-human primate studies show cumulative dosing

Alnylam had long telegraphed the results for the phase II
studies. They stated that we should
expect the clinical results to be essentially the same as what they are seeing with
the drug in non-human primates. I
understand that non-human primates are an immensely insightful model system in
RNAi Therapeutics development. Still, making such strong suggestions just weeks before clinical data release seemed a bit odd in that it risked stealing its own thunder.

Anyhow, the non-human primate studies showed the peak and
the terminal knockdown (terminal knockdown defined as the knockdown just before
repeat dosing) increased with each additional dose administration. Whereas the peak/terminal knockdown in cycle 1
was ~85%/47% at 0.3mg/kg, they were ~90%/58% in cycle 2 and so on. This is what Alnylam refers to as with ‘cumulative’
efficacy.

Unfortunately, this was only partially repeated in humans.

Knockdown not as sustained with repeat dosing

The ALN-TTR02 phase II study represented the first opportunity to rigorously test gene knockdown of a SNALP-delivered RNAi Therapeutic following
repeat dosing. Whereas the phase I study
in healthy volunteers was a one-dose study, this phase II study was a 2-dose
repeat-administration trial in European patients with TTR amyloidosis (FAP
form). In both studies, target gene
knockdown could easily be determined by measuring TTR levels in the blood.

In my analysis of the data, I will stick with slide 10 of Alnylam’s slide set which seems to provide the clearest overview of the data. At the critical
0.3mg/kg dose level, the peak knockdown either remained +/- the same (~80à80% for
once-every-4-weeks) or showed evidence of cumulative activity (~80à88% for
once-every-3-weeks) when comparing the first with the second dose administration. While this looks
quite good, albeit somewhat less than what was observed in the phase I study, slide 5),
the downside surprise comes with the terminal knockdown values. Here, the knockdown for cycle one (day 28;
n=6) was around 75% with tight error bars, but dropped to 60% for cycle two (day
56; n=5) with much more considerable inter-patient variability. The same was observed for the 0.15mg/kg dose
level with ~53% and ~45% reductions after cycle one and two, respectively.

I have no idea where Alnylam is getting the 93% knockdown
from that is so prominently mentioned in the press release. Are they referring to a single patient that
achieved such knockdown?

Once-every-3-weeks to stay on top of competition

You can safely assume that reduced knockdown duration and the fact that the critical phosphorothioate antisense competitor
by ISIS/GSK has a ~70% knockdown have driven Alnylam’s decision to amend the
ongoing phase II study by including once-every-3-week regimens.

Data for the first such cohort was provided. As noted above, once-every-3-weeks showed evidence of cumulative peak knockdown activity thus staying on top of the antisense competition. It is a shame though that the data provided coincidentally ended on day 35, only a week
before the important repeat terminal knockdown point. It is thus not possible to tell whether
diminished terminal knockdown is also an issue for the once-every-3-week
regimen.

Safety findings largely related to route of
administration

Safety findings were only reported at the 0.3mg/kg level (4
events in 9 patients). The infusion-related
reaction and the 'nuisance' side effect of fever/chills are known for SNALP delivery, but do not appear to be prohibitive. Unfortunately, there was a serious adverse
event due to a misplacing of the infusion needle.
New to me is the finding of polyuria (peeing a lot).

Based on this profile, Alnylam will try to lower the amount
of immune suppression given with the drug. Immune suppression is given as a precaution to avoid hypersensitivity reactions seen with SNALP-enabled TKM-ApoB. It seems to me that in introducing
the once-every-3-week regimen, Alnylam wants to dial up the product profile by
lessening the burden of the immune suppression.

The future of ALN-TTR02

Given the high unmet medical need for FAP patients,
ALN-TTR02 should remain on track of making it to the market provided reduced TTR
levels indeed translate into a clinical benefit (a low risk at 80% knockdowns). Some additional warts, however, have been
added to the product profile and my main interest as to the future data will
be how efficacy and safety is maintained not after just two, but after 3,
4, 5 doses and so on.

It would also be good to find an explanation for the diminished knockdown
duration (e.g. some neutralizing antibodies or a peculiarity of TTR gene regulation?). Tekmira, the delivery partner which should receive a $5M milestone on the initiation of ALN-TTR02 phase III
studies at the end of this year, would be an important ally in answering this
question. This could therefore be an
important test of whether the two companies can put aside past differences.

Saturday, June 29, 2013

The abstracts for the Peripheral Nerve Society Meeting in France have been published. The abstract on ALN-TTR02 does not reveal the results, but I post them anyway as a warm-up for tomorrow. You can notice though that there is a relative shift towards the once-every-3-week regimen and the dose escalation started at the same point as the phase I study did (0.01mg/kg). Check back for more tomorrow.

INTERIM RESULTS FROM PHASE II TRIAL OF ALN-TTR02, A NOVEL RNAi THERAPEUTIC FOR THE TREATMENT OF FAMILIAL AMYLOIDOTIC POLYNEUROPATHY

Familial amyloidotic polyneuropathy (FAP) is a fatal, autosomal dominant, multi-system disease caused by abnormal tissue deposition of mutant and wild-type transthyretin (TTR). Almost all circulating TTR is synthesized by hepatocytes, and in FAP this liver-derived TTR is responsible for amyloid accumulation in the main target organs, including peripheral nerves, gastrointestinal tract and heart. Treatment approaches have focused on reduction of amyloidogenic TTR monomer either through elimination of hepatic production of mutant TTR (liver transplantation) or stabilization of the TTR tetramer (tafamidis). While both of these approaches have been shown to slow neuropathy progression in a limited subset of FAP patients with the V30M mutation and early disease, there remains a signiﬁcant unmet need for new therapies that can impact FAP patients with different TTR mutations across a broader range of disease severity. ALN-TTR02 is a systemically administered lipid nanoparticle (LNP) formulation of a small interfering RNA (siRNA) targeting wild-type and all mutant forms of TTR. This formulation predominantly delivers the siRNA to the liver, thereby inhibiting synthesis of TTR at the primary site of production. In non-human primates, repetitive dosing with ALN-TTR02 every 3–4 weeks at doses up to 0.3 mg/kg resulted in an average relative TTR suppression of up to 90% with no tachyphylaxis of the pharmacodynamic effect. In a randomized, placebo-controlled, Phase I dose-escalation trial in healthy volunteers, a single intravenous infusion of ALN-TTR02 administered over 60 minutes was shown to be safe and well-tolerated, and potently suppressed serum TTR levels by 82-94% at doses of 0.15–0.5 mg/kg. TTR reduction of up to 67% was observed out to 28 days post- dose, suggesting that sustained TTR knockdown could be achieved with a monthly dosing schedule. Based on these promising results, a multi-national Phase II trial of ALN-TTR02 in FAP patients was initiated in mid-2012 to evaluate the safety/tolerability and pharmacodynamic effect of multiple doses of ALN-TTR02. Patients receive two doses of ALN- TTR02 administered every 3–4 weeks at dose levels ranging from 0.01 to 0.3 mg/kg, with a total anticipated enrollment of approximately 27 patients. In this presentation, we will provide an update on the results of this ongoing clinical trial.

Thursday, June 27, 2013

One concern with the use of any drug is that it ought to be eventually
eliminated from the body. This is a
particular issue with nanoparticulate drugs for which efficacy have been the
main design criterion. To address biodegradability for Tekmira's SNALP delivery, a technology that routinely involves
un-natural lipids which may not be easily biodegradable, Alnylam has just published
on SNALP lipid-derivatives containing readily degradable ester bonds. The results show that such SNALPs are rapidly
eliminated from the body and indicate that their use can increase
the therapeutic index.

In the paper, Maier and colleagues took the (once fiercely
contested) MC3 lipid, which is part of the ALN-TTR02 formulation for which
phase II results are imminent, and tested whether the
incorporation of ester bonds at various positions in the lipid tail would
retain knockdown efficacy. The ester
bond was chosen because it was predicted to maintain the MC3 lipid geometry and
can be degraded by the ubiquitous esterases in the body. Consistent with the idea that the apparent
pKa of the head group is important for efficacy, positions were identified that
left the pKa, and consequently knockdown activity in mice largely unchanged (ED50 of <0 .01mg="" kg="" o:p="">0>

To confirm the prediction that the resultant SNALP particles,
economically formulated with microfluidics, were less stable than their parent
particles, plasma and tissue elimination rates as well as the generation of
turnover intermediates were tested.
Indeed, the new SNALP particles were much less stable.

What is more, at doses of more than 3mg/kg SNALP-siRNA there was a trend
towards slight elevations with the MC3 SNALP, but not with a derivative. The authors stopped short, however, to test
concentrations at which much more toxicity can be seen.

The major downside of the study, however, was that in
non-human primates, the new SNALPs had less activity than expected for MC3
SNALPs. At 0.3mg/kg, the dose at which
80-90% knockdown was observed in the phase I study of ALN-TTR02, only a 70% TTR knockdown was
achieved. Nevertheless, it is likely
that other biodegradable SNALPs optimized for primates will achieve MC3-type efficacy.

I do not expect SNALP biodegradability to become an issue
for the upcoming ALN-TTR02 phase II results.
The longer-term dosing experience with cancer RNAi Therapeutic ALN-VSP02,
however, suggested that there could be spleen toxicity with extended dosing and
at higher dose levels. The last word
from Alnylam on that issue had been that the spleen toxicity was due to
on-target activity. The paper by Maier
et al., however, leads me to believe that both explanations are still on
Alnylam’s table.

Wednesday, June 26, 2013

My fundamental believe as to why RNAi is fundamentally
preferable over phosphorothioate (PS) antisense for therapeutic gene knockdown,
is that PS antisense involves the saturation of various tissues in the body
with a sticky chemistry that is associated with inflammation. By contrast, with RNAi Therapeutics, you only
need to transiently achieve relatively high tissue levels so that enough of the
RNAi silencing machinery can be fed with the RNAi triggers. Unincorporated oligonucleotides can, and
usually are, then washed out without much or any loss of efficacy.

Especially in chronic settings and systemic administration,
this persistent inflammatory herd raises the specter of multi-organ fibroses
and other adverse immune effects, including vasculitis. The mipomersen briefing docs showed that such
concern is warranted, especially with the findings of vasculitis in non-human
primates and frequent injection site reactions which, in contrast to ISIS
management which routinely characterizes them as ‘cosmetic’ and ‘nuisance’ side
effects, should be interpreted as indicators of what might be happening more
systemically.

As you also know, I am equally wary of the reliability of
ISIS’ forward and backward looking statements.

Obviously, when ISIS reported phase II data from theISIS-ApoCIII study showing a deep 88% knockdown of the target gene and impressive
>70% reductions in serum triglycerides, the question of whether this is a
real drug or another KYNAMRO/mipo-like dud hinges on its safety profile.
Unfortunately, no hard numbers were provided on this front in the
initial press release. Instead, there was much beating around the bush characterizing them as being very infrequent and mild in nature.

However, in the conference call, one analyst apparently wasn’t
satisfied with this and asked for a straightforward quantification of
the injection site reactions (the following is an adaptation of the telcotranscript on Seeking Alpha):

Jim Birchenough – BMO Capital Markets

Yeah. Hi, guys.
Congratulations on the data. A few questions…And then just final [third]
question, if you could quantify injection site reaction profile and contrast it
with KYNAMRO, I think that would be helpful…

Richard S Geary (ISIS
Pharmaceuticals)

Good. This is Richard,
and thank you for those questions...The third question, I don’t think I got.

Stanley T Crooke

Reactions compare and
contrast to KYNAMRO.

Richard S Geary

So you will remember
that in our Phase 1 experience we actually compared directly with three weeks
study in normals and we saw almost a 90% reduction in the frequency of ISRs.

Stanley T Crooke

Compared to KYNAMRO.

Richard S Geary

Compared to KYNAMRO,
and I would say that looking at these Phase 2 studies, this is being replicated
very low frequency and much less severity. These are very mild and it’s almost
all erythema that resolves very quickly.

Stanley T Crooke

So we’re seeing much
more mild and much less frequent injection site reactions in this study as we
saw in earlier work. Is that a fair way to say it, Richard?

Richard S Geary

Yes.

A 5-fold
exaggeration of the reduction in injection site reactions

So while ISIS did not add much regarding the frequency
of injection site reactions in the phase II study, at least a relative number was provided for ISIS-ApoCIIIRx.
Going back to the phase I trial for which the results were recently
published (Graham et al. 2013), the following was said about the frequency of
injection site reactions:

‘The most common adverse event was mild injection site
reaction, a typical response to subcutaneously administered drugs.52 No subject
dosed with placebo complained of injection site reactions, al- though 13 of 25
(52%) subjects dosed with ISIS 304801 experienced at least one. Approximately 1 of 6 injections (median,
17%) led to an injection site reaction, the majority of which resolved
within an hour.’

To test the veracity of ISIS’ comments, you would then have
to dig up the numbers for mipomersen. In
the FDA briefing docs, the following can be found about the frequency of injection
site reactions:

‘ISRs were the most commonly reported AE in the clinical
development program. In the pooled Phase 3 trials, 84.3% (220/261) of
mipomersen-treated individuals experienced 3,683 ISR events and 33.3% (43/129)
of individuals in the placebo group experienced 139 ISR events.’

Assuming for simplicity that the 261 subjects in the phase
III studies received 52 injections minus X due to drop outs (note: this fudge
factor actually favors ISIS’ numbers as it increases the injection site rate
for mipo) we arrive at around 3683 injection site reactions from 10,000
injections, i.e. a rate of around 37%. If ISIS’ comments on the 90% drop in
injection site reaction frequency were then true, the rate for ApoCIII should
be 3-4% and not 17% (according to ISIS the mipo injection site reaction rate would have to be 170% for the numbers to match up).In a 13-week
trial, a 17% injection site reaction rate also means that the majority of
subjects will experience such reactions, some more often and severe than
others.

Of course, I am just a molecular biologist and know little
math. I therefore look forward to the ISIS bulls or even the company itself to
point out where I went wrong in my calculations.

Monday, June 24, 2013

Small molecules, monoclonal antibodies, and fish oils move
out! Combining the power of genetics and
therapeutic gene knockdown, ISIS Pharmaceuticals presented last night by far
the most profound reduction in serum triglycerides which are thought to be an important risk
factor in cardiovascular disease and other less common conditions such as
pancreatitis: a 72% reduction of serum triglycerides following an 88% gene knockdown
of ApoC III with a bonus 40% elevation of the good HDL cholesterol in a phase II
study of ISIS-ApoCIIIRx presented at the Amercian Diabetes Association. This confirms in Man that ApoC III antagonizes the metabolism of triglycerides.

The ApoC III knockdown results were not unexpected. In the preceding phase I study, 71% and 78%
ApoC knockdowns were seen at the 200mg/week and 400mg/week dose levels,
respectively. The enhanced, 88% knockdown
seen in this phase II study at the 300mg/week level can be explained by the fact that the study drug in
the first study was only given for 4 weeks, at which point the phosphorothioate
oligonucleotide may not have reached saturation in the liver, whereas in this
study it was given for 13 weeks.

More surprising was the deep 72% reduction in serum triglycerides. In the phase I studies, 'merely' 43-44% reductions were observed, although this to my
knowledge is still superior to e.g. Amarin’s glorified and controversial fish
oil. It is possible
that this result is due to a non-linear relationship between ApoC III and
serum triglyceride lowering.

Obviously, questions remain unanswered following this small and still early-stage study. I was surprised to
learn that data were reported for only 11 patients with 200 and 500 mg/dL serum
triglycerides and type 2 diabetes (the enrolment criteria) although the
clinicaltrials.gov entry indicates that 24 was the originally planned number for the
blinded, placebo-controlled study.

Secondly, it will be important to learn about the safety and
tolerability profile of ISIS-ApoC IIIRx, also in light of the clinical trial experience
with the ApoB-targeting, LDL cholesterol-lowering mipomersen (aka KYNAMRO). To wit, ‘nuisance’ side effects such as
injection site reactions and flu-like symptoms contributed to frequent
discontinuations in the trials and likely explain what appears to be a very
slow uptake after marketing approval. Of course, Dr. Stan Crooke, the ever-so
optimistic CEO of ISIS Pharmaceuticals is convinced that ISIS-ApoCIIIRx has no
such issues due to improved screening methods. As a reminder, in the phase I study with ISIS-ApoCIIIRx, one out
of six injections were associated with injection site reactions.

Thirdly, the link between ApoC III and cardiovascular risk
is still debated. Moreover, similar to
ApoB, ApoCIII is thought to contribute to VLDL efflux and inhibiting it may
lead to an elevation of liver triglycerides.
This is particularly problematic given that the target patient population
is already at an increased risk of hepatosteatosis.

While phosphorothioate
antisense company ISIS Pharmaceuticals clearly has a head-start on ApoC III,
given the ability of various RNAi technologies to potently knock down genes in
the liver, ApoC III is an attractive target for the RNAi Therapeutics industry. Such a candidate could either be positioned as a best-in-class alternative (à
safety; I particularly like here the prospect of a subQ DPC version) or possibly as part of a multi-targeting cocktail against cardiovascular
disease (attractive for SNALPs). It is also one with an
attractive partnering potential for some of the smaller companies in the space (early
clinical POC, maybe partnering even before clinical development).

Thursday, June 20, 2013

Among the first crop of systemic RNAi Therapeutics for
cancer (see also CALAA01 by Arrowhead and ALN-VSP02 by Alnylam), Atu027 has
become the first to officially enter phase II clinical development. Following the completion of a bridging phase
Ib study testing the safety of Atu027 in combination with chemotherapeutic
gemcitabine for a treatment cycle of 28 days, Silence Therapeutics announced this week that safety and efficacy
of the RNAi-chemo combo will now be more rigorously tested in an expanded phase II study for
the treatment of pancreatic cancer.

The bridging study became necessary since in the initialphase I study, the safety of Atu027 was assessed in isolation only. The press release by the company now suggests
that the bridging study testing 0.253mg/kg of Atu027 along with 1000mg/m2
gemcitabine was uneventful since no expansion of cohorts was deemed
necessary. Such an expansion would have
become necessary if a dose-limiting toxicity had been observed. Accordingly, the results are in line with
the phase I studies where a dose limiting toxicity was only observed at the
0.336mg/kg dose of this AtuRNAi-lipoplex formulation.

Given that Atu027 is not thought to have a strong effect in
terms of directly killing cancer cells, but instead is expected to inhibit metastatic
spread, the company believes that it will be clinically most useful in
combination with an antineoplastic agent such as gemcitabine in pancreatic cancer. The choice of pancreatic cancer was probably
driven by the high unmet medical need in this indication and it is possible
that additional combinations will be explored for a range of other
cancers. Such an expansion of the Atu027 franchise will have to be balanced by the advancement of other RNAi Therapeutic
candidates with more straightforward mechanisms of actions to put the company on a more balanced financial footing.

* In addition to the
systemically delivered Atu027, two other RNAi Therapeutics for cancer have
entered phase II development. These are
the implanted RNAi trigger-eluting siG12D LODER from Silenseed, also for
pancreatic cancer, and ex vivo ddRNAi-GMCSF gene therapy combo bi-shRNAfurin by
Gradalis for a variety of cancers.

Wednesday, June 19, 2013

The biotech sector is white hot these days, and as a result, the IPO window is wide open.
This is illustrated by the fact that preclinical companies like gene
therapy outfit Bluebird Bio and Agios Pharmaceuticals have either just slipped
through the window or are about to. This is also illustrated by the fact that Duchenne
Muscular Dystrophy (DMD) exon skipping company Prosensa is aiming at a
valuation of $400M at its IPO despite the uncertainties around the
approvability of its only product candidate that matters (endpoints and safety
issues) and for which it has given away much of the financial potential to a Big Pharma (GSK). And the ticker: RNA.

As it relates to gene therapy and RNA Therapeutics companies
IPOeing- in addition to Prosensa, small molecule RNA processing modulation Co. PTC
Therapeutics and aptamer company Regado- a gap between the valuations of
already public companies and those emerging from the obscurity of the private
sector is becoming apparent. Without
meaning to talk down on Bluebird Bio or gene therapy, I am scratching my head as to why this
early-stage company sports a $150-200M market cap (it priced above its guided range and popped 50% on the open) whereas a much more proven
and clinically advanced lentivirus-based gene therapy company, Oxford
Biomedica, is not valued at even a quarter of that.

Given that Oxford Biomedica is developing
drugs for medically important indications, especially for those affecting the eye and can be
proud of a remarkable preclinical literature record, just as Bluebird Bio can,
the difference cannot be product versus platform focus. Or take for comparison preclinical microRNA Therapeutics company Regulus Therapeutics (2012
IPO) with a market cap of $350M and clinically slightly more advanced Arrowhead
Research with a market cap of around $60M (disclosure: I own Arrowhead).

Instead, I believe it shows the benefit of being able to
stay out of the spotlight when valuations are severely depressed as
they were in the wake of the housing crisis when research and having a pipeline were actually assumed to be liabilities, not assets.
Companies like Oxford Biomedica and Arrowhead Research may thus be
viewed as damaged goods. Only supposed
best-in-class companies in the RNA Therapeutics space with a halo like Alnylam and ISIS
Pharmaceuticals were able to decisively spring back from low valuations as
sentiments improved.

By contrast, biotech networks such as the one around Third Rock
have understood to wrap up biotech companies as exciting new toys for Wall
Street to buy. Orphan drugs anybody? Of interest, Alnylam’s CEO John Maraganore has
had an involvement with both Agios and Bluebird. I give these individuals full credit for
promoting innovation. By the same
token, the depressed valuations of some of the existing innovators are another example
of the inefficiency of the public markets.

Sunday, June 16, 2013

Although the phase I results for ALN-TTR01 in late 2011 and
ALN-PCS02 in first half of 2012 should have caught the attention of the diligent
biotechnology investor, it was the highly potent knockdown (>90%)
reported for ALN-TTR02 in July of last year that put the spotlight back on RNAi Therapeutics. The results for the TTR amyloidosis drug
candidate not only benefited Alnylam, they were a blessing to the entire field
of RNAi Therapeutics allowing it to raise ~$300M over the ensuing 12
months. It is therefore an understatement that
the phase II results for ALN-TTR02 to be disclosed in about two weeks will be
closely watched across the industry and investors.

Possibly hoping to relieve some of the tension around the
event, Alnylam has long telegraphed what we should expect the results from this
open-label study to be: just look at the multi-dose non-human primate data
and this is what you will see repeated in humans. Nevertheless, I doubt that the generalists
are buying the argument that non-human primates studies are highly predictive of
clinical results, at least in terms of gene knockdown. Just witness the valuations of other RNAi Therapeutics companies that have reported impressive non-human primate data (one could call that a buying opportunity).

Study primarily designed for safety…

The phase II study for ALN-TTR02 is primarily one of safety for repeat administration of ALN-TTR02. The initial two-dose study design seems an overly cautious approach given that products enabled by
Tekmira’s SNALP delivery technology have already been dosed for several months in patients with
cancer. This could be due to differences
in how the different divisions within the FDA view the safety of SNALP and/or RNAi
product candidates.

With regard to hypersensitivity reactions, which are
probably the most critical hurdle ALN-TTR02 needs to overcome, multi-dosing should actually the lower the incidence of infusion reactions (desensitization) which were the major safety issue in the phase I single-dose study. With regard to spleen toxicity, multi-dosing is predicted to increase risk (cumulative).

Overall, given the dose (study geared towards the 0.3mg/kg dose) and history of ALN-TTR02, I am quite
optimistic that no nasty surprises will emerge on the safety front. This would also be consistent with plans by
Alnylam to reduce the use of immune suppressants in the extension phase of the
study.

…but efficacy could drive volatility

Although we have already been told what the efficacy results
should look like and that Alnylam is aiming for an 80% knockdown, I expect analysts to pay close attention to efficacy given that Alnylam is in an arms race with ISIS/GSK. As a
reminder, in the 300mg/week regimen that has been chosen for the ongoing phase
II/III study, a ~70% knockdown was reported with the ISIS/GSK antisense compound.
However, while a phosphorothioate antisense compound for
liver-targeted gene knockdown given weekly has a sustained knockdown effect
over time, there are wider fluctuations between peak and trough knockdowns
for a SNALP-delivered RNAi Therapeutics administered only once a month. In other words, watch the time-course of the
knockdown, especially after Alnylam announced that it is considering a
once-every-3-weeks regimen for the extension phase of the study.

Wall Street ascribes most of Alnylam’s value to TTR
amyloidosis program

The reason, of course, why the TTR amyloidosis data is expected
to cause major volatility is because two thirds if not more of Alnylam’s market value
is based on a discounted cashflow analysis for ALN-TTR02 and ALN-TTRsc in the
polyneuropathy and cardiomyopathy markets, respectively. It is estimated that with premium orphan
pricing (you will be surprised how precisely Alnylam’s pharmacoeconomic models will arrive at a fair price of $300,000 per patient year), peak sales revenues
for Alnylam’s TTR products will be somewhere between $1.3-$2.0 billion.

I am optimistic that the TTR product candidates will make it
to market and dominate over any phosphorothioate-based antisense
competitor. However, there remain
important uncertainties as it relates to pricing and reimbursement, especially
in some of the European markets where many of the FAP patients reside. Furthermore, there is always an element of
chance when it comes to avoiding prohibitive toxicities from sequence-specific
off-targeting in a chronic treatment setting.

Over time, however, it does look like the rest of Alnylam’s
pipeline is finally gathering steam.
With the porphyria and AAT deficiency candidates ALN-AS1 and ALN-AAT,
respectively, and the intriguing complement inhibitor program, additional differentiated,
high-value orphan opportunities are emerging.
It remains to be seen, however, whether the GalNAc-siRNAs are potent
enough to exploit the potential of RNAi Therapeutics for these diseases or
whether other delivery technologies enabling deeper knockdowns would have been
appropriate. This concern e.g. applies
to the hemophilia program where my feeling is that only deep knockdowns will
allow you to see clinically meaningful improvements in clotting times. Unfortunately, I am still trying to find results from
clotting assays (which are standard in the field) and not just the thrombin measurements
that Alnylam is providing.

Trading the event

As Alnylam's share price has tripled since last year's announcement of phase I results and given that the two-dose design won't do that much for additional de-risking, I am speculating that only in a very bullish, confident biotech market that seizes on every news opportunity there is much upside from the phase II top-line results. Because of the nervousness that has been creeping into the markets the last two weeks, I am taking a small bearish position ahead of the event, in a way hedged by much larger long positions in other RNAi Therapeutics companies (Arrowhead Research, Tekmira, RXi Pharmaceuticals) which are more attractively valued on a relative basis and should benefit from renewed RNAi Therapeutics investor interest as a result of the data release.

Last reminder that the GTC RNAi Therapeutics conference will start this week. Don't forget to mention 'RNABLG13' for 20% discount on registration.

Thursday, June 6, 2013

RXi Pharmaceuticals today reported top-line results from
the first of two phase I studies with RXi-109 in dermal scarring. Intriguingly, the company claims to observe
target gene knockdown three months following a single
intradermal injection of their self-deliverable RNAi trigger (p=0.02) in a
manner that was apparently dose-related.

Such a drug-dependent and dose-related knockdown would
exceed my expectations from this trial as stated in a recent preview here. The reason why I merely expected to see a
correlation between CTGF levels and phenotypic effect on dermal scarring being
reported today is that I did not have high confidence that the tissue residence time
of RXI109 would be prolonged enough to observe a bona fide RNAi knockdown.

To wit, the tissue biopsy on which this data rests was obtained
during a tummy tuck three months after the intradermal injection of the RNAi. To assess whether there was an RNAi knockdown
in such a single-dose study, I would have thought that an early time-point such
as two weeks after injection would have been more appropriate, also because it is likely that some of the CTGF-producing cells might be proliferating in this setting (RNAi duration inversely correlated to proliferation status).

The notion that a correlation between CTGF levels and wound
healing would be observed was based on CTGF reflecting tissue
inflammation. So regardless of whether
there was an RNAi effect or not, you might expect to see such a correlation. It is difficult, however, to explain a drug-dependent and dose-related
target gene knockdown with this notion, except for by a rare coincidence.

These results then bode well for the multi-dose phase I
studies from which results will be reported in time for
the Investor and Analyst Symposium on July 12.
While safety was the primary focus of the first study (no
adverse event on the early wound healing process confirmed), the effect of
RXi-109 on wound healing will be the focus of the second study. It should be added though that given the small size of the trials and the patient population which is not predisposed to scarring, spotting the difference will be tough.

Monday, June 3, 2013

There is more evidence from the San Diego biotech scene that
investment is flocking back to RNAi Therapeutics, from all sorts of sources. Following successful public offerings by the
likes of Arrowhead Research and Alnylam and multi-million dollar VC rounds in
two smaller RNAi Therapeutics companies earlier this year, the investment this
time is coming from a large diversified company and private investors.

Nitto Denko Tackles Fibrosis

With the initiation of clinical development for an RNAi Therapeutics in fibrosis, not Merck, not Novartis or Takeda, but Japanese materials manufacturer Nitto Denko has
become the largest company yet to enter an RNAi Therapeutics into the clinic which originated from internal R&D. The newest
addition to the RNAi Therapeutics pipeline is based on research from Prof.
Niitsu’s laboratory at Sapporo Medical University and involves a vitamin
A-targeted liposome for gene knockdown of a collagen-specific chaperone (Hsp47)
in fibrogenic cells. Subsequent to the
seminal Nature Biotech publication on gene knockdown in hepatic stellate cells
for not just the stabilization, but even the reversal of liver fibrosis (Sato et al. 2008), a more recent publication applying the same formulation in pancreatic fibrosis
indicates that Nitto Denko is considering ND-L02-s0201 for fibroses beyond the
liver.

Of note, the RNAi trigger design came
from Quark Pharmaceuticals (Tuschl workarounds with lots of non-canonical
modifications) and Nitto Denko itself has become the world’s largest clinical supplier
of oligonucleotides following its 2011 acquisition of Avecia.

Fibrosis is becoming a hot area in Oligonucleotide
Therapeutics with a number of companies (RXi Pharmaceuticals, Excaliard/Pfizer,
Sirnaomics, BMT etc) chasing fibroses in the skin, eye, liver, and beyond. As fibrosis is a complication, often the most debilitating consequence of many diseases involving inflammation
(think fatal diseases such as idiopathic pulmonary fibrosis), and little
progress has been made in reversing it, the expanded target space available to
oligonucleotide therapeutics could bring unique opportunities at changing the
way we think about the disease.

Coincidental with the Nitto Denko trial initiation, San
Diego-based Arcturus Therapeutics announced that it has raised $1.3M in a
private investor round. Arcturus
Therapeutics, curiously founded by former Nitto Denko employees, is said to be
developing a liver-targeted RNAi Therapeutics for an unnamed rare/orphan disease
indication. It appears that the value of Arcturus is based on a nanoparticle delivery technology. Although the nature of the formulation is yet
to be disclosed, my impression is that it is a liposomal one given the
background of the company founders and the liver indication.

It is very good seeing examples like that where the RNAi
Therapeutics appetite is reaching down to the grass-roots levels, unfathomable even
just 1 ½ years ago. While I once worried
that the RNAi Therapeutics dry spell (2008-2011) could prove disastrous to
innovation in the industry, some seeds were able to survive. I look forward to following the progress of
these technologies and companies as they grow.

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